EC Forces Changes to Digital Cinema Contract Terms

Following a preliminary own-initiative investigation by the European Commission’s competition authorities, Hollywood studios and Europe’s third-party integrators have amended provisions of their Virtual Print Fee (VPF) contracts, notably the ones that ensured all distributors were offered the same deal. Commission was concerned that the relevant clauses could be in breach of EU rules that prohibit restrictive business practices as laid out in Article 101 of the EU Treaty. The studios made the changes before a full and formal investigation was needed. The issue has been simmering for some time as it was felt that some terms within the contracts could be detrimental to Europe’s independent film distributors in accessing VPF-backed cinemas.